The 720: Shionogi & Chugai - upgrade to Buy, Property Asset Managers, Japan Banks, Sumitomo Electric, FOMC preview

Research evidence excerpt

The 720: Shionogi & Chugai - upgrade to Buy, Property Asset Managers, Japan Banks, Sumitomo Electric, FOMC preview

t solid Q1 volume growth of 16-29% year-on-year

as a delayed monsoon extends the summer season, though lower-than-expected price

increases will likely pressure margins amid raw material inflation. Consequently, we cut

our EPS estimates by up to 8% across the coverage group. We maintain Buy ratings on LG

Electronics India and Crompton, while lowering our 12m TPs for Buy-rated Havells to

Rs1,510 and Sell-rated Voltas to Rs1,140 to reflect the profitability challenges. Pulkit

Patni

GS Event | Sumitomo Electric, India CRO/CDMO

Sumitomo Electric Industries – Investor Call : Potential volume upside for

infocommunications – Buy. We hosted an investor call with management, who noted that

demand from data center customers has strengthened since the FY3/27 guidance and

FY3/29 medium-term plan were announced, suggesting potential volume upside. With

competitors facing optical fiber capacity constraints, we see room for market share

gains and potential price hike effects given tight supply and demand. We maintain our

Buy rating and 12m TP of ¥12,500, noting that our base case incorporates almost no

CPO-related upside. Ryo Harada

India CRO/CDMO – Structural opportunity intact, capex picking up with a focus on new

modalities. We remain constructive on the India CRDMO industry, as our recent

company tour reinforced that the structural opportunity remains intact, supported by

Biosecure considerations and rising outsourcing intensity. Most companies are investing

ahead of demand and moving up the complexity curve toward peptides, ADCs,

oligonucleotides, and biologics CMO, with competitive moats increasingly built on

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